Online Accounting Systems Can Result In More Effective Services

Taking your accounting online can help you streamline your finances, making for more organized accounting and reliability in other areas of your services offerings.

Organized data and better management

When your accounting moves online, human intervention is greatly reduced, automatically resulting in heightened accuracy. Because accounting is one of the basic functions in a business, scattered or poorly-maintained accounts can create problems across all your business offerings and client services. Online accounting automatically results in better organization of your records and helps you maintain updated and current records across the services and solutions you provide your clients.

Online accounting systems do not mean you no longer have control over your accounts. On the contrary, it takes off the drudgery from your day-to-day operations so that you have time and resources for your business concerns. Online accounting takes over data entry and management so that you no longer struggle with complex data or spend quality man hours in training staff to meet your specific needs. Once you hand over your needs to a qualified vendor, you will find that an online accounting system actually speeds up your operations overall, allowing you to provide deliverables and services to your clients better.

Complete and updated data

An online accounting system provides you with complete financial information at your fingertips. What is the money owed to you by your clients, what is the exact amount and by how much time is it overdue - all of these questions can be answered when you look at your accounts, provided they are updated. Low on cash? An online accounting system can help ensure you don't face crippling cash crunches that could force you to disable your client deliverables and regular services.

Further, having updated accounting means you are on top of your expenses and balance sheets. This is vital not just from the perspective of a business owner, but also from the point of view of investors who will examine your credit-worthiness. Here are some specific benefits that prove how an online accounting system can help you spruce up operations and deliver better solutions and services.

Satish Patel, CPA
President, Analytix Solutions
Satish Patel, Founder-CEO of Analytix Solutions, has more than two decades of experience as a CPA. He has also advised small and mid-sized businesses on diverse matters such as valuation, accounting, and finance. His experience extends to raising capital and arranging for finance from angel investors.

Implementing Business Process Improvements For Finance Departments

Current economic times demand that organizations and small businesses achieve more with less. The concept of business process improvement (BPI) has evolved into an operational strategy that can no longer afford to be overlooked as "optional". In order to remain competitive, a company's internal functions must be reengineered and reassessed to become more efficient. Business owners must evaluate and search for efficiency in their processes, systems and organizational structure. This type of evaluation needs to occur at the departmental level, as well as the overall business level. Within Finance departments, BPI should be assessed in five key areas.

Optimizing Cash Flow - Predictability of cash flow is critical for a small to mid-sized business. Regulating accounts payables and receivables directly impacts cash flow. Anything that is paper driven or a manual process should be evaluated for business process improvement. This avoids inconsistency of processing and allows functions to be performed at the same time each month or via a similar practice.

Improvement in Reporting - Accounting systems should provide reports that reveal key operating information which is pertinent to a specific business or industry. Systems must evolve from just reporting to adding value. They must provide information that enhances accuracy and understanding of information, as well as allow business owners to derive key pieces of operating intelligence about their business. Systems that can offer customized reports which generate key pieces of integral data should be considered in order to reduce "data crunching" thereby replacing it with usable data for analysis.

Budgeting and Forecasting - Access to reliable and timely data is critical to budgeting and forecasting, and accurate budgeting and forecasting is critical to the success of a small to mid-sized business. This process needs to be streamlined and performed on a regular basis. As with optimizing cash flow, this process should be evaluated for automating tasks, such as manual data entry, wherever possible.

Developing and Adhering to Cost Controls - Fluctuations and even small variations in costs can produce vast implications on budgets and cash flow for small to midsized companies. Creating cost controls is a process improvement from which every business can benefit. These controls ensure an alignment between costs and budget and work diligently to mitigate the occurrence of extreme corrective budgeting actions.

Organizational Structure - Personnel functions should be evaluated to ensure that expertise is appropriately leveraged and that manpower is deployed as needed. This may require business owners to reconsider their organizational structure in terms of cross functional teams as opposed to a hierarchical structure, or vice versa.

As a small business owner or entrepreneur, evaluating these five areas of BPI within a finance department allows your business to function more productively. We are currently offering a free analysis of your business processes and accounting system. If you would like to discuss BPI within your finance department and learn more on how Analytix Solutions can help move your business forward, please call me directly at 781.503.9004 or email me at sales@aixsol.com

Satish Patel, CPA
President, Analytix Solutions
Satish Patel, Founder-CEO of Analytix Solutions, has more than two decades of experience as a CPA. He has also advised small and mid-sized businesses on diverse matters such as valuation, accounting, and finance. His experience extends to raising capital and arranging for finance from angel investors.

Accounts Outsourcing Transition – Pitfalls and Practices

Outsourcing accounting and bookkeeping services is witnessed when a firm purchases online accounting and bookkeeping services from an outside vendor, rather than executing the same task within its own facilities, with an aim to cut costs. In this process the transitioning phase is a critical step in outsourcing.

The Challenges

A few of the challenges could include change management issues, deployment and procurement delays, insufficient knowledge transfer, lack of senior management support, communication gap etc.

Change management system is often not in practice to deal with the transition in several companies. Lack of methodology and foolproof planning is yet another pitfall that frustrates the success of outsourcing transition. In addition, communication breakdown or lack of proper communication also contributes to the failure of transition. Lack of proper knowledge transfer puts the transition phase in doldrums. More importantly, absence of senior management backing to the transition process is the most prominent pitfall that jeopardizes the entire transition initiative. The bigger challenges may be even unpredictable because not all challenges can be predicted at the initial level.

The Best Practices to Ensure Successful Transition

Methodology

Methodology isn't simply a process, it shows how important an accounting and bookkeeping services provider treats the transition phase and with how much of maturity level. The core elements of a good methodology are frequent audits, facilitation of tools and techniques, simplicity of implementation and effectiveness of monitoring process.

Robust Planning

More robust the planning process, better the execution. The key activities at the planning phase should be amalgamation of timeline and expectations, proper resource allocation, and clearly defined criterion to access the success of transition phase should be formulated to make the outsourcing online bookkeeping from transition to business phase.

Risk Management Approach

The proactive approach to predict potential drawbacks early, gives sufficient time to carry out amendments, if required, and enables design a response strategy. In this risk management practice risk identification and risk response methodology should be reviewed occasionally. Risks must be specified clearly and the impacts and possibilities need to be evaluated. Every potential risk response should be addressed with equal significance.

Governance

Many transitions fail with the failure of implementing a governance structure. “No-slack” implementation of governance structure during transition ensures alignment of project objectives with the stakeholders. The communication plan also needs to clearly circumscribe the frequency and format of communication that will be received and sent by shareholders. The well structured governance tracks status of project and changes if any and more importantly, avoids any surprises.

Buyer Readiness

Synchronization of service provider’s past experience and buyer’s readiness is instrumental in the successful transition of online bookkeeping phase. Support of management team should be identified and involved closely to check the progress and delivering support. Clearly defined expectation, clear, fair and upfront communication with affected staff should be the initiative of change management. Resource and budget allocation should be done to guarantee the support to multiple work streams.

Partnership Approach

The joint efforts of accounting bookkeeping service provider and buyer ensure the success of the outsourcing initiative. The teamwork of online accounting service provider and buyer during the transition phase constitutes the foundation and pitch of relationship for the duration of the contract. All pitfall and issues needs to be viewed as project issues rather than service provider or buyer issues. Understanding and trust among both the parties are crucial and they should work towards the common goal of successful transition.

These are a few of the best transition practices that should be considered when hiring online bookkeeping and accounting services.

Accounting Services: A Means For Focusing More On Your Small Business

Using accounting services has become a common practice with small and mid-sized businesses, which have fewer resources to manage their business with. A professional accounting service provider has the potential of saving small businesses up to 40% in costs, which can be used to develop the business further. However, using an accounting firm to maintain books of accounts is not just a way to reduce costs; it has many other benefits also.

Focus on your main business activity

The most important reason you should use accounting services from a professional is that you can then focus on your main business activity. Maintaining your books of accounts is not your specialty, and you should hence not spend time doing that. If you have an accounting firm taking care of all your accounting and bookkeeping, you can stop worrying about it and spend more time on core activities which can increase business for you. Handing over all your accounting tasks to an experienced accounting service provider will free valuable time for you which can be a crucial factor for making your small business successful.

Reduce employee-related issues

Many businesses face a lot of issues related to hiring, training and retaining in-house employees. Sometimes, in case of bigger problems, businesses face employee-related lawsuits, which are time consuming. When you use accounting services from a service provider, you don’t have to worry about any issue related to employees, as you are using services and not employing people directly. An accounting firm hence ensures that you save on time and resources of hiring in-house employees.

Experts at your service

Using accounting services from a professional ensures that your books of accounts are being taken care of by experts in the field of accounting and bookkeeping. Accounting firms hire experts who are efficient and experienced at what they do and will work better than an in-house accountant. With such experts working on your accounting, there will also be less likelihood of mistakes in the work that is completed. You hence not only save cost of hiring an accountant, but also get a much more experienced staff to complete your accounting.

Save on office space and resources

The space that your in-house accountant would utilize for maintaining your books of accounts can be saved if you use outsourced accounting services. Accounting firms generally provide online accounting, which eliminates the requirement of any office space. You hence save on rent of an office or the space occupied by your accountant, which you can utilize elsewhere in your business.

No last minute problems

An accounting service provider updates transactions in your books of accounts on daily basis. You can hence stop worrying about pending tasks or last minute glitches at the time of tax filing and annual audits. Your books will be up to date at any given point of time, which eliminates the hassles of last-minute problems which are typically faced at the time of filing of tax.

An experienced accounting firm can reduce your burden of everyday activities, so that you can develop your business according to the vision you have. You may benefit even more if your accounting service provider has some experience in dealing with businesses similar to yours.

Online Accounting: How small businesses can benefit from it

As a small business owner, you may be facing a tough task of managing all departments of your business at once. Running a small business is a tough task as it is; add to that the responsibility of handling small business accounting and bookkeeping, and it may become an impossible one. If hiring in-house staff for handling your books of accounts is not an option for you, consider hiring the services of an online accounting service provider. Online accounting is known for its benefits, especially for small businesses. Some of the benefits of online accounting are as mentioned below:

Cost Effective
The first, foremost and most important advantage of online accounting is its cost effectiveness. Not only does hiring online bookkeeping service save you the cost of hiring in-house resources, it also ensures that additional resources like office space, rent etc. are not wasted. You can then invest the money and resources saved through online accounting into the business to ensure its profitability.

Quick Turnaround
Online accounting service providers provide a very quick turnaround as they have dedicated personnel working on your books of accounts. In many cases, the online bookkeeping service provider gives an assurance of updating your books of accounts within 24 hours of receipt of the documents. Such speedy work ensures that accounting and bookkeeping of your small business is up to date at all times.

Experts at Work
Let’s admit it: you do business well, but maintaining books of accounts like a pro is not your cup of tea. When you hire online accounting services, you can rest assured that there is an experienced professional working on your books. Such experts also ensure that the work done is impeccable and there are less chances of any mistake in your small business accounting.

Easy to Use
Online accounting services make your work very easy with a simple procedure. You just need to send your documents to your online bookkeeping service provider via email; the rest is all taken care of by online accounting professionals on the other end. You can hence stop worrying about your business financials the minute you email the document and concentrate on running your small business.

Efficient Record-Keeping
Online accounting or online bookkeeping gives a lot of importance to record-keeping. When you hire a professional for online accounting, you need not maintain separate records for your own reference. The latest and most accurate accounting information will be maintained by professionals when you decide to use online bookkeeping services. You can get access to these records 24x7, which is a facility given by most service providers today.

Online accounting has the potential of aiding you in running your business efficiently and reducing your overall responsibilities. There are many online bookkeeping service providers today which offer customized packages. You can select the one that best suits your small business requirements.

Is Using Outsourced Accounting Services the Right Step for Your Small Business?

For a long time, using outsourced accounting services was an option only for larger corporations. However, of late, the cost effectiveness of outsourcing accounting functionalities has made it an attractive prospect for small businesses as well. A small business owner is generally burdened with taking care of all the functions of the business with very little resources at his/her disposal. Outsourcing to expert accounting service providers has the potential of saving a lot of resources and hence is an attractive proposition for small business owners.

But the question most small business owners are pondering over is: Does hiring a bookkeeping and accounting service provider make sense for small businesses? Judging the answer to this question is tricky and requires evaluating the pros and cons of outsourcing accounting.

There are advantages attached to hiring an outsourced accounting service provider which are especially applicable to small businesses:

1. The main advantage of outsourcing accounting functions is its cost effectiveness, which can save your small business up to 40% costs as compared to in-house staff
2. Accounting service providers have expert staff who can handle all your small business accounting requirements with ease
3. You can choose to hire only those services which are applicable to your business
4. Outsourcing accounting frees up valuable time which you can dedicate to the core business activities
5. You are relieved from the hassles of hiring, training and retaining in-house staff

There is only one small disadvantage when it comes to hiring outsourced accounting services: Too many companies providing accounting services which makes it tough to decide which one to hire. If you hire an inefficient service provider, it may cost your business a lot more. So select an accounting service provider with a lot of care, taking into consideration the following factors:

1. Is the bookkeeping and accounting service provider experienced in your industry?
2. Can the firm give valid references of its current/past clients?
3. Does the firm have a reputation of providing accounting services for small businesses?
4. Can the firm assure a doorstep service if required or is it purely outsourcing company based miles away within US or outside US?
5. Is the accounting firm ready to give written documents regarding guarantee of service, terms and conditions etc?
6. Is the accounting service provider flexible enough to allow you to scale your bookkeeping and accounting requirements up or down?
7. Does the firm providing outsourced accounting service have suitable data security measures to protect sensitive information related to your small business?

If you get satisfactory replies to all of the above questions, you should rest assured that the accounting service provider you are considering to hire is suitable for your small business.

The advantages of outsourcing small business accounting far surpass the disadvantages of outsourcing accounting functionalities. If you work with the right service provider, it can become a valuable asset to your small business. As a small business owner, you should hence consider availing the services of a professional bookkeeping and accounting service provider so that they can focus on the core activities of the business and grow it appropriately.